<article><p class="lead">US company New Fortress Energy plans to launch a $700mn LNG-to-power project in Nicaragua next month, just as the Central American country draws increasing international scrutiny ahead of November elections.</p><p>The 25-year project is designed to deliver 60,000mn Btu/d (419,000 t/yr) of LNG for a new gas-fired 300MW power station at Puerto Sandino in western Nicaragua.</p><p>On 6 July, New Fortress said it had reached an <a href="https://direct.argusmedia.com/newsandanalysis/article/2232026?keywords=new%20fortress%20hygo">agreement for LNG supply</a> to cover the remaining volumes for its existing natural gas and electricity businesses, including Mexico and Nicaragua, through end-2027, with more volume to be secured for Brazil. The unspecified volumes will likely originate in the US.</p><p>The New York-based company has not responded to repeated requests for comment on its Nicaragua project.</p><p>In February 2020, New Fortress chief executive Wes Edens was in Managua to sign a 2,233 GWh/yr power purchase agreement with Nicaraguan state-owned power distributors Disnorte and Dissur. And in October 2020, the government-controlled National Assembly of Nicaragua passed a special law providing a legal framework and extensive tax incentives for the project headed by New Fortress' local subsidiary NFE Nicaragua Development Partners.</p><p>Puerto Sandino is one of multiple Latin American projects that New Fortress is currently developing. The company grew exponentially early this year with a $2.18bn <a href="https://direct.argusmedia.com/newsandanalysis/article/2176723?keywords=new%20fortress%20hygo">deal to acquire</a> the Brazilian LNG and power assets of Norway's Golar and US private equity fund Stonepeak Infrastructure Partners.</p><h3>Unwanted attention</h3><p>In the latest sign of growing pressure on Managua, the European Parliament yesterday adopted a resolution condemning Nicaraguan repression and calling for the release of political prisoners, including prominent opposition figures who were poised to challenge President Daniel Ortega in 6 November elections.</p><p>In an event sponsored by the Inter-American Dialogue (IAD) this morning, former Costa Rican president Laura Chinchilla urged the international community to do more to isolate the Ortega government, drawing a distinction with Nicaragua's ally Venezuela, where she says <a href="https://direct.argusmedia.com/newsandanalysis/article/2228684?keywords=Venezuela">international sanctions</a> were not accompanied by a "coherent diplomatic strategy."</p><p>Venezuela's regional subsidized oil supply program PetroCaribe funneled money to the Nicaraguan government through the Albanisa venture, Chinchilla said. </p><p>She called on the international community to follow a US lead with targeted sanctions and the 2018 Nicaraguan Investment Conditionality Act (NICA), and urged multilateral agencies to suspend all funding, citing as an example the International Monetary Fund's $185mn emergency economic assistance approved in November 2020 and $342mn in back-to-back funding since May from Central American economic integration bank BCIE. </p><p>IAD non-resident senior fellow Manuel Orozco said such multilateral funding accounts for about $200mn a year or 10pc of Nicaragua's state budget, providing "oxygen to the repressive apparatus and clientelistic networks". </p><p>Among other tools under consideration is a suspension of Nicaragua from international trade agreements, including CAFTA-DR with the US and an association agreement with the EU, a move that could hurt projects such as Puerto Sandino LNG.</p><p>But Orozco warned that "suspending CAFTA can actually increase the revenue of the Nicaraguan state because of the tariffs that would be imposed on exports and imports."</p><p class="bylines"><i>By Patricia Garip</i></p></article>